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La elección del sector laboral y los retornos a la educación en Guatemala
[Labour Sector Choice and the Returns to Education in Guatemala]

  • Alejos, Luis Alejandro

This paper estimates the returns to education in Guatemala, while attempting to account for self-employment and the presence of workers without monetary earnings in the economy, factors whose omission can potentially lead to sample selection bias. The analysis uses data from the Survey of Living Conditions (ENCOVI 2000) to obtain estimates of the rate of returns to different levels of schooling using a human capital earnings function. A multinomial logit model for sector choice is implemented to correct for selection bias as in Bourguignon, Fournier and Gurgand (2001). Non-linearities in the returns to education are strongly supported by the empirical results. It is found that OLS estimates which do not account for sector choice significantly overestimate the returns to primary and early secondary schooling, while underestimating the returns to late secondary education. The results also show lower rates of return in the self-employment sector and that workers who only complete primary or early secondary schooling have a higher probability of entering this sector.

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File URL: http://mpra.ub.uni-muenchen.de/42756/1/MPRA_paper_42756.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 42756.

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Date of creation: 2006
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Handle: RePEc:pra:mprapa:42756
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  1. Williams, Donald R., 2002. "Returns to education and experience in self-employment: Evidence from Germany," IRISS Working Paper Series 2002-04, IRISS at CEPS/INSTEAD.
  2. Dorothe Bonjour & Lynn F. Cherkas & Jonathan E. Haskel & Denise D. Hawkes & Tim D. Spector, 2003. "Returns to Education: Evidence from U.K. Twins," American Economic Review, American Economic Association, vol. 93(5), pages 1799-1812, December.
  3. Harry Anthony Patrinos, 1996. "Non-linearities in the returns to education: sheepskin effects or threshold levels of human capital?," Applied Economics Letters, Taylor & Francis Journals, vol. 3(3), pages 171-173.
  4. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4 National Bureau of Economic Research, Inc.
  5. James J. Heckman & Lance J. Lochner & Petra E. Todd, 2003. "Fifty Years of Mincer Earnings Regressions," NBER Working Papers 9732, National Bureau of Economic Research, Inc.
  6. Orley Ashenfelter & Alan Krueger, 1992. "Estimates of the Economic Return to Schooling from a New Sample of Twins," Working Papers 683, Princeton University, Department of Economics, Industrial Relations Section..
  7. Psacharopoulos, George, 1996. "A reply to Bennell," World Development, Elsevier, vol. 24(1), pages 201-201, January.
  8. Loening, Josef L., 2005. "Effects of primary, secondary, and tertiary education on economic growth : evidence from Guatemala," Policy Research Working Paper Series 3610, The World Bank.
  9. David Card, 2000. "Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems," NBER Working Papers 7769, National Bureau of Economic Research, Inc.
  10. Chiswick, Barry R., 2003. "Jacob Mincer, Experience and the Distribution of Earnings," IZA Discussion Papers 847, Institute for the Study of Labor (IZA).
  11. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  12. Gaston, Noel & Tenjo, Jaime, 1992. "Educational Attainment and Earnings Determination in Colombia," Economic Development and Cultural Change, University of Chicago Press, vol. 41(1), pages 125-39, October.
  13. Tsung-Ping Chung, 2000. "The Returns to Education and Training: Evidence from the Malaysian Family Life Surveys," Studies in Economics 0007, School of Economics, University of Kent.
  14. Griliches, Zvi, 1977. "Estimating the Returns to Schooling: Some Econometric Problems," Econometrica, Econometric Society, vol. 45(1), pages 1-22, January.
  15. Bennell, Paul, 1996. "Rates of return to education: Does the conventional pattern prevail in sub-Saharan Africa?," World Development, Elsevier, vol. 24(1), pages 183-199, January.
  16. Jacob Mincer, 1958. "Investment in Human Capital and Personal Income Distribution," Journal of Political Economy, University of Chicago Press, vol. 66, pages 281.
  17. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, May.
  18. Lee, Lung-Fei, 1983. "Generalized Econometric Models with Selectivity," Econometrica, Econometric Society, vol. 51(2), pages 507-12, March.
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